College Accounts 2018-19

CHRIST’S COLLEGE CAMBRIDGE

Annual report of the Trustees

and Accounts prepared under the Recommended Cambridge College Accounts (RCCA) format

for the year ended 30 June 2019

Christ’s College

St Andrew’s Street Cambridge

CB2 3BU

Registered charity number 1137540

Contents

Page

Operating & Financial Review

Structure, Governance & Management 2

Aims, Objectives & Public Benefit 3

Funding 4

Achievements and Performance 5

Financial Review 6

Plans for the future 7

Advisers 8

Statement of Internal Control 9

Responsibilities of the Trustees 9

Auditors’ Report 10

Principal Accounting Policies 13

Statement of Comprehensive Income & Expenditure 18

Statement of Changes in Reserves 19

Consolidated Balance Sheet 20

Consolidated Cash Flow Statement 21

Notes to the Accounts 22

OPERATING AND FINANCIAL REVIEW 1. STRUCTURE, GOVERNANCE & MANAGEMENT Christ’s College is a self-governing corporate body, established by royal charter. The Statutes & Ordinances, which are published on the College website, govern the activities of the College. The Governing Body is comprised of the Fellows of the College. A list of Fellows is also published on the College website. Undergraduate and postgraduate student representatives are also co-opted members of the Governing Body. The College is a registered charity (registered number 1137540) and subject to regulation by the Charity Commission for England and Wales. The members of the College Council are the charity trustees and are responsible for ensuring compliance with charity law. The College Council is responsible for oversight of the management of the assets, income, expenditure and educational business of the College, in accordance with the directions and subject to the limitations laid down in the College statutes. The College Council consists of the Master, the Bursar and the Senior Tutor, ex officio, and ten members elected from the membership of the Governing Body. Each elected member is elected to serve for a period of two years and may be re-elected for two further terms of two years each. Members of the Council during the year ended 30 June 2019 were: (ex officio) Professor B J Stapleton FBA (Master), Mr D J Ball (Bursar), Dr R E Hunt (Senior Tutor) (elected) Dr Beck, Professor Betegh (to 28.09.18), Professor Edwardson

Professor Gay, Professor Leslie, Professor Marteau, Dr Pfeifer, Dr Punskaya, Dr Read (from 28.09.18), Dr Shvets, Dr Vout

From 28 September 2018 to the year end, a majority of the Trustees were female. No fees are paid to Fellows in respect of their duties as members of the College Council, although a number of the members of the Council hold office or employment with the College and receive remuneration in respect of the services they provide. Stipends, salaries and fees for these services are determined on the advice of a remuneration committee with external members. The total amount paid to serving members of the Council in the year ended 30 June 2019, including pension contributions, was £0.5m (2018: £0.5m). Declarations of interest are made systematically at meetings. The Council is advised in carrying out its duties by a number of committees. The Financial Control Committee advises the Council on the annual budget, monitors income and expenditure during the year, and reviews the annual report and accounts before presentation to Council and Governing Body. The accounts of the College and its subsidiaries are externally audited. The Investments Committee, which includes members with relevant professional expertise, receives reports from professional advisers and advises the Council on estates and securities investments. The principal officers of the College are the Master, who is responsible overall for the work of the College, the Bursar who is its chief administrative and financial officer and the Senior Tutor who is responsible for the oversight of its educational work.

2. AIMS, OBJECTIVES AND PUBLIC BENEFIT The College’s objective is the advancement of education, religion, learning and research through the provision of a college within the University of Cambridge. The primary aim of the College, as an independent foundation within a collegiate university, is the provision of education leading to degrees awarded by the University of Cambridge. It also supports research by Fellows and students. The College creates public benefit in these ways, for both individual students and more broadly for society. The College commits significant resources to various outreach activities designed to encourage undergraduate applications by able candidates from all backgrounds and schools. This supports the University’s Access and Participation plan, which has been agreed with the Office for Students. Financial aid is also provided to students. The College typically provides access bursaries, awarded on the assessment of financial need, for over 25% of UK/EU undergraduates and over 100 scholarships and prizes, awarded on performance in University examinations. The College also offers studentships and grants towards travel and research expenses for academic purposes. Within the collegiate university, the College’s educational role (in common with the other Colleges) is to select and admit its own undergraduates and graduates, to provide advice about programmes of study and arrange small-group teaching for undergraduates, to provide pastoral care and to monitor each individual student’s progress. Ancillary to this role, the College provides a library, residential accommodation, catering and recreational facilities and a chapel. The College also makes provision for student activities in sport, music, drama and the visual arts. It seeks to enable its students to achieve their full potential, through both academic success and participation in the broad range of extra-curricular activities which the College and the University provide. The 500-year-old College site contains much that is uniquely important in the nation’s architectural heritage. The College maintains these buildings and gardens, and allows public access to the gardens for most of the year. The benefits afforded by collegiate life in the Cambridge system are the interactions that are fostered within a relatively small but diverse community, both academically across disciplines and socially, between students and Fellows (who are often leading scholars or researchers in their field). A high proportion of students live in or close by the College, take meals in College and participate in College clubs, societies, and sporting activities; some Fellows are resident in College and many are present in College during the day in term time, to teach, to participate in College business or because it is their base to carry out research. The drop-out rate among the College’s undergraduates is extremely low, compared to the national average. This is attributed to the care taken in the selection of undergraduates for admission, the provision of pastoral care, the attention paid to teaching in small groups, the steps taken to monitor each individual student’s progress, and the financial support available through bursaries in cases of hardship. The academic progress of graduate students reading for higher degrees is primarily the responsibility of the faculty or department of the University in which they work. The College however provides considerable support for these students also, through pastoral care, residential accommodation for many graduate students in College flats or houses, the opportunity to participate in social and sporting activities and to interact with the Fellowship, access to research and travel grants, and financial assistance.

3. FUNDING 3.1 The College’s main sources of funding were income generated from its charitable activities and its investments:

£000 2018/19 2017/18 Academic Fees & Charges 3,067 3,002 Residences, Catering & Conferences 4,182 4,175 Investment Income 3,136 2,981

The College also received donations and new endowments of £2.9m (2017-18: £2.4m). 3.2 The College continues to rely heavily on investment income, and on bequests and donations, in order to undertake its charitable activities. It continues to seek funding for:

• additional support for undergraduate and graduate students • provision of teaching Fellowships • additional accommodation for graduate students and improvement of other College facilities

Together with donations and legacies for general purposes, these will help the College to continue to provide the quality of teaching and collegiate experience to which we remain committed. 3.3 We are required to report each year on the approach taken to fundraising. The Trustees are satisfied that the College’s fundraising activity conforms to recognised standards of practice. The College is registered with the Fundraising Regulator. The College benefits from charitable donations and legacies, which are mostly from members of the College, their families and friends. The Development Office produces a range of communications material to update College members on recent activities in College and describing current initiatives. Fundraising activity with these individuals is managed by the College’s Development Office staff, who are salaried and do not receive any compensation linked to donations. We also receive some support from charitable foundations. We may make proactive approaches to such foundations and other ‘corporate’ donors. There is also an annual telephone campaign, proactively contacting a number of College members. (Those who may be contacted are given each year a prior opportunity to opt out.) Campaign calls are made by current students at the College and appropriately supervised. The College engages a firm of consultants to work with the Development Office to deliver the campaign. Fundraising activity is monitored in several ways. All donations are reported to the College’s Governing Body (which includes the Trustees) at its regular meetings. There is also a College committee which meets regularly to receive reports on fundraising and to approve planned activity. No annual financial KPIs are set because the incidence of donations and bequests is unpredictable, but the College monitors the effectiveness of activity. The College’s practices protect College members and the general public, including vulnerable people, from frequent or pressured requests to make donations. Individuals’ preferences in relation to all College communications are recorded and respected. No complaints about fundraising matters were received during the year.

4. ACHIEVEMENTS AND PERFORMANCE The Trustees have had due regard throughout the year to the Charity Commission’s guidance on public benefit, and consider that the College again delivered its planned public benefits in 2018/19. 4.1 Educational Activities It is pleasing to report that for the second successive year the College’s undergraduates achieved the best performance in University Tripos examinations, as measured by the Tompkins Table. Undergraduates also participated in a wide range of other sporting, cultural and charitable activities, with a number of notable achievements. Graduate students also continued to achieve good academic results, while the graduate community within the College was active in organizing academic and social events through the MCR. The College operates within policies and strategies determined by the University and the Colleges collectively, for example on admissions targets and the provision of teaching. The numbers of undergraduate and graduate students in residence and registered with the University were:

2018/19 2017/18 Undergraduates 437 440 Postgraduates 249 258

4.2 Research Activities The College provided a variety of financial support to Fellows and students for research, with a number receiving recognition of their achievements during the year. The College also provides Fellowships for early career academics both as Junior Research Fellows and as College Teaching Officers. In 2018-19 there were in total 17 such Fellows, including one on leave (‘intermitting’), and 4 new elections were made during the year.

5. FINANCIAL REVIEW The College has prepared its consolidated accounts in accordance with the Recommended Cambridge College Accounts or ‘RCCA’ format. 5.1 Statement of Comprehensive Income & Expenditure There was again a deficit on continuing operations (excluding donations). Fee income from UK and EU undergraduates is regulated. There was also an increase in the staff pensions deficit relating to the cost of funding prior years’ service. Significant gains were made on investments (net of distributions during the year). The College was fortunate to receive generous donations and bequests, including a major donation to purchase an additional graduate hostel very close to the College, which has been refurbished and will accommodate students for the 2019-20 academic year. 5.2 Balance Sheet The consolidated balance sheet remains strong, with retained investment gains and donations increasing total reserves to £197m (2018: £190m). The College has sufficient liquid funds to meet all normal contingencies. 5.3 Reserves Policy Unrestricted reserves totalled £78m (2018: £76m), of which £76m represents conservatively valued fixed assets, giving “free reserves” of £2m. These are considered adequate, taking into account the predictable nature of the College's main classes of unrestricted income and expenditure. (Any future increases in pension provisions for past service will be funded over a number of years.) There are also Endowment assets of £107m which support the College's activities. 5.4 Investments The College makes long term investments to generate income to support its charitable activity, while also seeking to preserve the real value of its capital (after inflation) to maintain inter-generational equity between current and future beneficiaries. The main elements of the College’s investment policy are:

• Asset allocation to achieve through diversification an appropriate balance between expected risks and returns – the main classes of investment currently held are equities, directly owned UK property and various non-equity ‘alternative investments’ including credit and hedge funds.

• Investment through or on the advice of carefully selected professional managers.

• Oversight on behalf of the Trustees by an Investments Committee comprised of Fellows and members

of the College with relevant professional experience. The College’s external managers take ESG factors into account in their investment processes. Total returns from the College’s investments were in excess of the amount appropriated to fund current spending, as set out in note 3b to the accounts. Total returns of about 6.3% were made on securities and about 7.7% on commercial and agricultural property holdings, with an overall return of under 7%. The distribution from the endowment during the year was just over 3% of the opening value of the endowment.

5.5 Risk Management The Council has established policies and procedures to manage the major risks to which the College is exposed. There are three main types of risk, relating to:

• The safety of the College's buildings and facilities. These risks are mitigated primarily by management procedures, including compliance with relevant regulations, and alarm systems.

• The security of the College's assets. There are both physical security measures in place and established

financial control procedures. Cyber security measures are in place to protect information assets. Insurance arrangements are reviewed annually with professional advisers.

• Investment risks relating to the College's long term investments. The main risk mitigation measures,

as described in section 5.4, are an asset allocation policy which provides diversification by type of investment, management of investments by carefully selected professional managers and oversight of asset allocation and investment performance by an Investments Committee which includes both Trustees and experienced investment professionals.

There are, as always, uncertainties regarding the future external environment within which the College will operate, most notably regarding higher education policy and funding. The Council considers however that the College will be able to respond effectively to changes in that environment. 6. PLANS FOR THE FUTURE The College does not anticipate major changes to its education and research activities in the foreseeable future, with student numbers in particular now expected to remain stable. Activity will also continue to support the University’s Access and Participation commitments. Plans have been prepared to construct additional student accommodation on the main College site, in response to past increases in student numbers, but planning permission has now been secured. As noted above, there are various uncertainties about the external environment. Mr D J Ball Bursar Christ’s College Cambridge Date: 4 October 2019

The College’s principal external advisers

Auditors PEM Salisbury House Station Road Cambridge CB1 2LA

Legal Advisers Ashtons Legal Chequers House 77-81 Newmarket Road Cambridge CB5 8EU

Bankers Lloyds Black Horse House Castle Park Cambridge CB3 0AR

Property Managers Bidwells Bidwells House Trumpington Road Cambridge CB2 9LD

Investment Managers Various

Statement of Internal Control The College Council is responsible for maintaining a sound system of internal control that supports the achievement of policy, aims and objectives while safeguarding the funds and assets for which the Governing Body is responsible, in accordance with the College’s statutes. The system of internal control is designed to manage rather than eliminate the risk of failure to achieve policies, aims and objectives; it therefore provides reasonable but not absolute assurance of effectiveness. The system of internal control is designed to identify the principal risks to the achievement of policies, aims and objectives, to evaluate the nature and extent of those risks and to manage them efficiently, effectively and economically. This process was in place for the year ended 30 June 2019 and up to the date of approval of the financial statements. The College Council is responsible for reviewing the effectiveness of the system of internal control. The Council’s review is informed by the work of the various committees, the Bursar and other College officers, who have responsibility for the development and maintenance of the internal control framework, and by comments made by the external auditors in their management letter and other reports. Responsibilities of the Trustees The trustees are responsible for preparing the annual report and financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). The College’s statutes and the statutes and ordinances of the University of Cambridge require the College Council to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the College and of the surplus or deficit of the College for that period. In preparing these financial statements, the trustees are required to:

• select suitable accounting policies and apply them consistently;

• make judgments and estimates that are reasonable and prudent;

• state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

• prepare the financial statements on the going concern basis unless it is inappropriate to presume

that the College will continue in operation. The trustees are responsible for ensuring that there is an effective system of internal control and that accounting records are properly kept. The trustees are responsible for taking reasonable steps to ensure that there are appropriate financial and management controls in place to safeguard the assets of the College and to prevent and detect fraud and other irregularities. The trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charity’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Independent auditors’ report to the Trustees of Christ’s College Opinion We have audited the financial statements of Christ’s College (the ‘College’) for the year ended 30 June 2019 which comprise the Consolidated Statement of Comprehensive Income and Expenditure, the Consolidated Statement of Changes in Reserves, the Consolidated Balance Sheet, the Consolidated Cash Flow Statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion, the financial statements:

• give a true and fair view of the state of the College’s affairs as at 30 June 2019 and of its incoming resources and application of resources for the year then ended;

• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice;

• have been prepared in accordance with the requirements of the Charities Act 2011 and the Statutes of the University of Cambridge; and

• the contribution due from the College to the University has been correctly computed as advised in the provisional assessment by the University of Cambridge and in accordance with the provisions of Statute G,II, of the University of Cambridge.

Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We are independent of the College in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Conclusions relating to going concern We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

• the trustees’ use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

• the trustees have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the College’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information The trustees are responsible for the other information. The other information comprises the information included in the Annual Report other than the financial statements and our auditors’ report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:

• The information given in the financial statements is inconsistent in any material respect with the operating and financial review ; or

• sufficient accounting records have not been kept; or • the financial statements are not in agreement with the accounting records; or • we have not received all the information and explanations we require for our audit.

Responsibilities of trustees

As explained more fully in the trustees’ responsibilities statement set out on page 9, the trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the trustees are responsible for assessing the College’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the College or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilties. This description forms part of our auditors’ report.

Use of our report This report is made solely to the College trustees, as a body, in accordance with College’s statutes, the Statutes of the University of Cambridge and the Charities Act 2011. Our audit work has been undertaken so that we might state to the College trustees those matters we are required to state to them in an auditors’ report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the College and the College trustees as a body, for our audit work, for this report, or for the opinions we have formed PETERS ELWORTHY & MOORE Chartered Accountants and Statutory Auditors Salisbury House Station Road Cambridge CB1 2LA Date: Peters Elworthy & Moore is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006.

Statement of Principal Accounting Policies Basis of preparation The financial statements have been prepared in accordance with the provisions of the statutes of the College and of the University of Cambridge and applicable United Kingdom accounting standards. In addition, the financial statements comply with the Statement of Recommended Practice: Accounting for Further and Higher Education (the SORP). The Statement of Comprehensive Income and Expenditure includes activity analysis in order to demonstrate that all fee income is spent for educational purposes. The analysis required by the SORP is set out in note 6. Basis of accounting The financial statements have been prepared under the historical cost convention, modified in respect of the treatment of investments, which are included at valuation. Basis of consolidation The consolidated financial statements include the College, its May Ball and its subsidiary undertakings. Details of the subsidiary undertakings included are set out in note 24. Intra-group balances are eliminated on consolidation. The consolidated financial statements do not include the activities of student societies other than the May Ball, since these are not material. Recognition of income Academic fees Academic fees are recognised in the period to which they relate and include all fees chargeable to students or their sponsors. The costs of any fees waived or written off by the College are included as expenditure. Grant income Grants received from non-government sources (including research grants from non-government sources) are recognised within the Consolidated Statement of Comprehensive Income and Expenditure when the College is entitled to the income and performance related conditions have been met. Income received in advance of performance related conditions is deferred on the balance sheet and released to the Consolidated Statement of Comprehensive Income and Expenditure in line with such conditions being met. Donations and endowments Non exchange transactions without performance related conditions are donations and endowments. Donations and endowments with donor imposed restrictions are recognised within the Consolidated Statement of Comprehensive Income and Expenditure when the College is entitled to the income. Income is retained within restricted reserves until such time that it is utilised in line with such restrictions. Donations and endowments with restrictions are classified as restricted reserves with additional disclosure provided within the notes to the accounts. There are four main types of donations and endowments with restrictions:

1. Restricted donations – the donor has specified that the donation must be used for a particular objective.

2. Unrestricted permanent endowments – the donor has specified that the fund is to be permanently invested to generate an income stream for the general benefit of the College.

Donations and endowments (continued)

3. Restricted expendable endowments – the donor has specified a particular objective and the College can convert the donated sum into income.

4. Restricted permanent endowments – the donor has specified that the fund is to be permanently invested to generate an income stream to be applied to a particular objective.

Donations with no restrictions are recorded within the Consolidated Statement of Comprehensive Income and Expenditure when the College is entitled to the income. Investment income and change in value of investment assets Total return With effect from 1 July 2012, the College has invested its endowment investment portfolio and allocated a proportion of the related earnings and capital appreciation to the income and expenditure account in accordance with the total return investment concept. The allocation to income is determined by a spending rule, which is designed to maintain an appropriate balance between annual levels of distribution from the endowment and the maintenance over time of the real value of the endowment. Prior to 1 July 2012, all investment income was credited to the income and expenditure account in the period in which it was received. Other income Income is received from a range of activities including residences, catering, conferences and other services rendered. Cambridge Bursary Scheme The College receives a contribution from the University towards this scheme. The College continues to include the gross payment made to eligible students as expenditure and the contribution from the University as Income under “Academic Fees and Charges”. To summarise, the net payment has been shown within the Consolidated Statement of Comprehensive Income and Expenditure as follows:

2019 £’000

2018 £’000

Income (see note 1) 159 147 Expenditure 329 314 Net payment 170 167

Foreign currency translation Transactions denominated in foreign currencies are recorded at the rate of exchange ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into sterling at year end rates or, where there are forward foreign exchange contract, at contract rates. The resulting exchange differences are dealt with in the determination of the comprehensive income and expenditure for the financial year.

Fixed assets Land and buildings The buildings on the main College site have been valued at depreciated replacement cost. The value of the land on the main College site has not been capitalised. Where parts of a fixed asset have different useful lives, they are accounted for as separate items of fixed assets. Costs incurred in relation to land and buildings after initial purchase or construction, and prior to valuation, are capitalised to the extent that they increase the expected future benefits to the College. Freehold land is not depreciated as it is considered to have an indefinite useful life. Freehold buildings are depreciated on a straight line basis over their expected useful lives as follows: Specialised buildings 100 years Flats & hostels 50 years Leasehold land is depreciated over the life of the lease up to a maximum of 50 years. Buildings under construction are valued at cost, based on the value of architects’ certificates and other direct costs incurred. They are not depreciated until they are brought into use. The cost of additions to operational property shown in the balance sheet includes the cost of land. Furniture, fitting and equipment Furniture, fittings and equipment costing less than £20k per individual item or group of related items is written off in the year of acquisition. All other assets are capitalised and depreciated over their expected useful life as follows: IT fibre 20 years Furniture and fittings 10 years Motor vehicles and general equipment 10 years Computer equipment and fire alarms 5 years. Heritage assets The College holds and conserves a number of collections, exhibits, artefacts and other assets of historical, artistic or scientific importance. Heritage assets acquired before 1 July 1999 have not been capitalised since reliable estimates of cost or value are not available on a cost-benefit basis. Heritage assets are not depreciated since their long economic life and high residual value mean that any depreciation would not be material. Investments Fixed asset investments are included in the balance sheet at market value. Listed securities are included at published prices. Unlisted securities are included at managers’ valuations, which are prepared in accordance with accepted accounting standards. Overseas investments are translated into sterling at the rates ruling at the balance sheet date. The College’s investment in its development subsidiary is valued on the expected future cash flows of the company, discounted at an appropriate rate. Development land is valued by the Bursar, after discussion with professional advisers, using expected future cash flows, discounted at an appropriate rate. Investment properties are valued on an annual basis by professional valuers, following RICS guidelines.

Investment income from securities is included as and when dividends and interest become payable. Interest on bank deposits is included on an accrual basis. Income from investment properties is recognised in the period in which the rental relates Stocks Stocks are stated at the lower of cost and net realisable value after making provision for slow moving and obsolete items. Provisions Provisions are recognised when the College has a present legal or constructive obligation as a result of a past event, it is probable that a transfer of economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Contingent liabilities and assets A contingent liability arises from a past event that gives the College a possible obligation whose existence will only be confirmed by the occurrence or otherwise of uncertain future events, not wholly within the control of the College. Contingent liabilities also arise in circumstances where a provision would otherwise be made but either it is not probable that an outflow of resources will be required or the amount of the obligation cannot be measured reliably. A contingent asset arises where an event has taken place that gives the College a possible asset whose existence will only be confirmed by the occurrence or otherwise of uncertain future events not wholly within the control of the College. Contingent assets and liabilities are not recognised in the balance sheet but are disclosed in the notes. Taxation The College is a registered charity (number 1137540) and also a charity within the meaning of Section 467 of the Corporation Tax Act 2010. Accordingly, the College is exempt from taxation in respect of income or capital gains received within the categories covered by Sections 478 to 488 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992 to the extent that such income or gains are applied to exclusively charitable purposes. The College receives no similar exemption in respect of Value Added Tax. Contribution under Statute G, II The College is liable to be assessed for Contribution under the provisions of Statute G,II of the University of Cambridge. Contribution is used to fund grants to colleges from the Colleges Fund. The liability for the year is as advised to the College by the University based on an assessable amount derived from the value of the College’s assets as at the end of the previous financial year. Pension costs The College participates in two funded defined benefit pension schemes, Cambridge Colleges Federated Pension Scheme (CCFPS) and the Church of England Funded Pension Scheme (CEFPS), a hybrid scheme, Universities Superannuation Scheme (USS), and two defined contribution pension schemes, Cambridge Colleges Group Pension Plan, which is administered by Aviva, and The NOW: Pensions Trust. The assets of the schemes are held in separate trustee administered funds. Pension costs are accounted for on the basis of charging the cost of providing pensions over the period during which the College benefits from the Fellows’ or employees’ services. Cambridge Colleges Federated Pension Scheme (CCFPS) In the case of the CCFPS, costs comprise service and finance costs.

Universities Superannuation Scheme (USS) The College participates in Universities Superannuation Scheme. The scheme is a hybrid pension scheme, providing defined benefits (for all members), as well as defined contribution benefits. The assets of the scheme are held in a separate trustee-administered fund. Because of the mutual nature of the scheme, the assets are not attributed to individual institutions and a scheme-wide contribution rate is set. The College is therefore exposed to actuarial risks associated with other institutions’ employees and is unable to identify its share of the underlying assets and liabilities of the scheme on a consistent and reasonable basis. As required by Section 28 of FRS 102 “Employee benefits”, the College therefore accounts for the scheme as if it were a wholly defined contribution scheme. As a result, the amount charged to the profit and loss account represents the contributions payable to the scheme. Since the College has entered into an agreement (the Recovery Plan) that determines how each employer within the scheme will fund the overall deficit, the College recognises a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) and therefore an expense is recognised. Church of England Funded Pension Scheme (CEFPS) As for the USS, because of the mutual nature of the CEFPS scheme, the College is unable to identify its share of the underlying assets and liabilities of each scheme on a consistent and reasonable basis and therefore accounts for the scheme as if it were a defined contribution scheme. The amount charged to the Income and Expenditure Account represents the contributions payable to the schemes in respect of the accounting period and in addition there is also a deficit recovery plan in place for the CEFPS and a liability has been recognised for the contributions payable by the College under the plan. Cambridge Colleges Group Pension Plan (administered by Aviva) and the NOW: Pensions Trust The Aviva and NOW: Pensions schemes are defined contribution schemes, hence the cost charged to the Income and Expenditure Account represents the employer contributions due in the financial year. Employment benefits Short term employment benefits such as salaries and compensated absences are recognised as an expense in the year in which the employees render service to the College. Any unused benefits are accrued and measured as the additional amount the College expects to pay as a result of the unused entitlement. Reserves Reserves are allocated between restricted and unrestricted reserves. Endowment reserves include balances which, in respect of endowment to the College, are held as permanent funds, which the College must hold to perpetuity. Restricted reserves include balances in respect of which the donor has designated a specific purpose and therefore the College is restricted in the use of these funds.

Consolidated Statement of Comprehensive Income and Expenditure Year ended 30 June 2019

2019 2018 Note Unrestricted Restricted Endowment Total Unrestricted

As restated Restricted Endowment Total

As restated Income £000 £000 £000 £000 £000 £000 £000 £000 Academic fees and charges 1 3,067 - - 3,067 3,002 - - 3,002 Residences, catering and conferences 2 4,182 - - 4,182 4,175 - - 4,175 Investment income 3 83 - - 83 48 - - 48 Endowment return transferred 3 1,906 1,147 - 3,053 1,863 1,070 - 2,933 Other income - - 179 - - 179 Total income before donations and endowments 9,238 1,147 - 10,385 9,267 1,070 - 10,337 Donations 1,757 600 - 2,357 1,008 521 - 1,529 New endowments - - 512 512 - - 676 676 Capital grants for assets - 31 - 31 - 182 - 182 Total income 10,995 1,778 512 13,285 10,275 1,773 676 12,724 Expenditure Education 4 4,357 1,390 - 5,747 3,991 1,160 - 5,151 Residences, catering and conferences 5 5,723 5 - 5,728 5,497 4 - 5,501 Other expenditure 5 1 - 6 261 1 - 262 Contribution under Statute G,II 42 22 - 64 38 21 - 59 Total expenditure 6 10,127 1,418 - 11,545 9,787 1,186 - 10,973 Surplus/(deficit) before other gains and losses 868 360 512 1,740 488 587 676 1,751 Gain/(loss) on disposal of fixed assets 8 - - - - 2 - - 2 Gain/(loss) on investments 9 385 490 5,482 6,357 510 606 4,187 5,303 Surplus/(deficit) for the year 1,253 850 5,994 8,097 1,000 1,193 4,863 7,056 Other comprehensive income Actuarial (loss) in respect of pension schemes 15 (847) - - (847) 730 - - 730 Total comprehensive income for the year 406 850 5,994 7,250 1,730 1,193 4,863 7,786

Statement of Changes in Reserves Year ended 30 June 2019

Note Income and expenditure reserve Unrestricted Restricted Endowment Total £000 £000 £000 £000 Balance at 1 July 2018 76,117 13,032 100,358 189,507 Surplus/(Deficit) from income and expenditure statement 1,253 850 5,994 8,097 Other comprehensive income (847) - - (847) Release of restricted capital funds spent in the year 2,016 (2,016) - - Transfers between funds (162) 26 136 - Balance at 30 June 2019 78,377 11,892 106,488 196,757

Note Income and expenditure reserve Unrestricted Restricted Endowment Total £000 £000 £000 £000 Balance at 1 July 2017 74,426 11,837 95,497 181,760 Prior year adjustment: residue of donations following investment 1 (1) - Prior year adjustment: May Ball consolidation 23 (39) - - (39) 74,387 11,838 95,496 181,721 Surplus/(Deficit) from income and expenditure statement 1,000 1,194 4,862 7,056 Other comprehensive income 730 - - 730 Balance at 30 June 2018 76,117 13,032 100,358 189,507

The notes on pages 22 to 37 form part of these accounts

Consolidated and College Balance Sheets as at 30 June 2019

2019 2019 2018 2018 Consolidated College Consolidated College Note £000 £000 £000 £000 Non-current Assets Fixed assets 8 76,380 76,380 74,119 74,119 Investments 9 126,626 126,626 122,089 122,089 Current assets Stocks 10 79 79 69 69 Trade and other receivables 11 809 725 980 943 Cash and cash equivalents 12 11,213 11,206 9,667 9,646 Creditors: amounts falling due within one year

13 (1,436) (1,435) (1,776) (1,761)

Net current assets 10,665 10,575 8,940 8,897 Total Assets less current liabilities 213,671 213,581 205,148 205,105 Creditors: amounts falling due after more than one year

14 (10,000) (10,000) (10,000) (10,000)

Provisions Pension provisions 15 (6,914) (6,914) (5,641) (5,641) Total net assets 196,757 196,667 189,507 189,464 Restricted reserves Income and expenditure reserve – endowment reserve

16 106,488 106,488 100,358 100,358

Income and expenditure reserve – restricted reserve

17 11,892 11,892 13,032 13,032

Unrestricted Reserves Income and expenditure reserve – unrestricted

78,377 78,287 76,117 76,074

Total Reserves 196,757 196,667 189,507 189,464

The financial statements were approved by the College Council on 4 October 2019 and signed on its behalf by: Mr D J Ball Bursar, Christ’s College, Cambridge The notes on pages 22 to 37 form part of these accounts

Consolidated Cash Flow Statement For the year ended 30 June 2019

2019 2018 Note £000 £000 Net cash inflow from operating activities 19 1,849 2,030 Cash flows from investing activities 20 (303) (2,495) Increase/(decrease) in cash and cash equivalents in the year 1,546 (465) Cash and cash equivalents at beginning of the year 9,667 10,132 Cash and cash equivalents at end of the year 12 11,213 9,667

The notes on pages 22 to 37 form part of these accounts

Notes to the Accounts For the year ended 30 June 2019

1 Academic fees and charges 2019 2018 £000 £000 Colleges fees: Fee income received at the Regulated Undergraduate rate 1,600 1,634 Fee income received at the Unregulated Undergraduate rate 624 555 Fee income received at the Graduate rate 684 666 Other income 159 147 Total 3,067 3,002

2 Income from residences, catering and conferences 2019 2018 £000 £000 Accommodation College members 2,358 2,329 Conferences 718 674 Catering College members 534 585 Conferences 572 587 Total 4,182 4,175

3 Endowment return and investment income 2019 2018 £000 £000 3a Analysis Total return contribution (see note 3b) 3,053 2,933 Other interest receivable 83 48 Total 3,136 2,981 3b Summary of total return Income from: Land and buildings 1,201 1,328 Quoted and other securities and cash 1,172 1,219 Gains/(losses) on endowment assets: Land and buildings 2,801 696 Quoted and other securities and cash 4,607 5,369 Investment management costs (see note 3c) (371) (377) Total return for year 9,410 8,235 Total return transferred to income and expenditure reserve (see note 3a) (3,053) (2,933) Unapplied total return for year included within Statement of Comprehensive

Income and Expenditure (see note 19) 6,357 5,302

3c Investment management costs Land and buildings (197) (229) Securities (174) (148) Total (371) (377) The costs shown for Securities include all investment fees invoiced to the College. It should be noted that

other investment costs are also incurred within investment funds. Investments are valued net of all such costs and the total return shown in Note 3b is also net of all such costs.


4 Education expenditure 2019 2018 As restated

£000 £000 Teaching 1,517 1,458 Tutorial 742 719 Admissions 355 333 Research 568 644 Scholarships and awards 894 803 Other educational facilities 1,671 1,194 Total 5,747 5,151

5 Residences, catering and conferences expenditure 2019 2018 As restated

£000 £000 Accommodation College members 3,800 3,704 Conferences 650 611 Catering College members 673 617 Conferences 605 569 Total 5,728 5,501

6a Analysis of 2018/2019 expenditure by activity Staff costs

(note 7) Other

operating expenses

Depreciation Total

£000 £000 £000 £000 Education 2,599 3,011 137 5,747 Residences, catering and conferences 3,203 1,749 776 5,728 Other - 70 - 70 Totals 5,802 4,830 913 11,545 Expenditure includes fundraising costs of £0.4m. This expenditure includes the costs of alumni relations.

6b Analysis of 2017/2018 expenditure by activity Staff costs

(note 7)

As restated

Other operating expenses

As restated

Depreciation Total

£000 £000 £000 £000 Education 2,184 2,786 181 5,151 Residences, catering and conferences 3,073 1,733 695 5,501 Other - 294 27 321 Totals 5,257 4,813 903 10,973 Expenditure includes fundraising costs of £0.4m. This expenditure includes the costs of alumni relations.

6c Auditors’ remuneration 2019 2018 £000 £000 Other operating expenses include: Audit fees payable to the College’s external auditors 33 33 Other fees payable to the College’s external auditors 7 6


7 Staff costs

Consolidated College Fellows

Other academic

Non-academic

2019 Total

2018 Total

£000 £000 £000 £000 £000 Staff costs: Emoluments 1,030 - 3,295 4,325 4,154 Social security costs 98 - 263 361 351 Other pension costs 518 - 594 1,112 745 Holiday pay provision - - 4 4 7 Total 1,646 - 4,156 5,802 5,257 Average staff numbers: Academic (numbers of stipendiary

staff) 51 - 1 52 47

Non-academic (full time equivalent) 3 - 106 109 109 Total 54 - 107 161 156 The Governing Body comprises 82 Fellows, of which the 54 declared above are stipendiary. No officer or employee of the College, including the Head of House, received emoluments of over £100,000. Trustees and key management personnel Key management personnel are those persons having authority and responsibility for planning, directing and

controlling the activities of the College. The trustees of the college, i.e. the College Council, are also the key management personnel. The members of College Council received no emoluments in their capacity as trustees of the charity, however they received emoluments totalling £0.4m (2018: £0.5m) in their capacity as college officers.


8 Fixed assets Consolidated and College Land and

buildings Assets in

construction Equipment 2019

Total 2018 Total

£000 £000 £000 £000 £000 Cost or valuation At beginning of year 75,150 3,868 1,978 80,996 77,237 Additions 2,412 525 237 3,174 3,758 Transfers - - - - - Disposals - - - - - At end of year 77,562 4,393 2,215 84,170 80,995 Depreciation At beginning of year 6,060 - 817 6,877 5,973 Charge for the year 739 - 174 913 903 Eliminated on disposals - - - - - At end of year 6,799 - 991 7,790 6,876 Net book value At beginning of year 69,090 3,868 1,161 74,119 71,264 At end of year 70,763 4,393 1,224 76,380 74,119 The insured value of freehold land and buildings as at 30 June 2019 was £140.2m (2018: £129.1m).

9 Investments Consolidated College Consolidated College 2019 2019 2018 2018 £000 £000 £000 £000 Balance at beginning of year 122,089 122,089 117,286 117,286 Additions 3,023 3,023 (379) (379) Disposals (4,697) (3,368) (1,150) (539) Transfers - - - - Gain/(loss) 7,408 6,079 6,066 5,455 Increase/(decrease) in cash balances held at

fund managers (1,197) (1,197) 266 266

Balance at end of year 126,626 126,626 122,089 122,089 Represented by: Property 30,777 29,497 32,672 31,773 Securities 94,888 94,888 87,259 87,258 Investments in subsidiary undertakings - 1,280 - 900 Cash in hand and at investment managers 951 951 2,148 2,148 Other investments 10 10 10 10 126,626 126,626 122,089 122,089 Property includes certain land holdings valued by management, after discussion with the College’s professional

advisers, at £4.2m (2018: £5.0m)


10 Stocks and work in progress Consolidated College Consolidated College 2019 2019 2018 2018 £000 £000 £000 £000 Goods for resale 79 79 69 69 79 79 69 69

11 Trade and other receivables Consolidated College Consolidated College 2019 2019 2018 2018 £000 £000 £000 £000 Members of the College 41 41 56 56 Amounts due from subsidiary undertakings - 149 - 288 Other receivables 370 370 375 421 Prepayments and accrued income 398 165 549 178 809 725 980 943

12 Cash and cash equivalents Consolidated College Consolidated College 2019 2019 2018 2018 £000 £000 £000 £000 Bank deposits 1 1 1 1 Current accounts 11,211 11,204 9,665 9,644 Cash at investment managers 951 951 2,148 2,148 Cash in hand 1 1 1 1 12,164 12,157 11,815 11,794 Investment assets (951) (951) (2,148) (2,148) 11,213 11,206 9,667 9,646

13 Creditors: amounts falling due within one year Consolidated College Consolidated College 2019 2019 2018 2018 £000 £000 £000 £000 Trade creditors 294 293 455 455 Members of the College 104 104 149 149 University fees 36 36 - - Other creditors 89 89 221 220 Accruals and deferred income 913 913 951 937 1,436 1,435 1,776 1,761


14 Creditors: amounts falling due after more than one year Consolidated College Consolidated College 2019 2019 2018 2018 £000 £000 £000 £000 Other loan (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) (10,000) During 2013-14, the College borrowed from institutional investors, collectively with other Colleges, the College's

share being £10 million. The loans are unsecured and repayable during the period 2043-2053, and are at fixed interest rates of approximately 4.4%. The College has agreed a financial covenant of the ratio of Borrowings to Net Assets, and has been in compliance with the covenant at all times since incurring the debt.

15 Pension provisions Consolidated College Consolidated College 2019 2019 2018 2018 £000 £000 £000 £000 Balance at beginning of year (5,641) (5,641) (6,138) (6,138) Movement in year: Current service cost including life assurance

(CCFPS) (355) (355) (363) (363)

Contributions 469 469 335 335 Other finance (income)/cost (173) (173) (158) (158) Actuarial loss/(gain) recognised in Statement

of Comprehensive Income and Expenditure (CCFPS)

(847) (847) 730 730

Change in recovery plan, discount rate or contribution assumptions (USS & CEFPS)

(367) (367) (47) (47)

Balance at end of year (6,914) (6,914) (5,641) (5,641)


16 Endowment funds Restricted net assets relating to endowments are as follows: Consolidated and College Unrestricted

permanent endowments

Restricted permanent

endowments

2019 Total

2018 Total

£000 £000 £000 £000 Balance at beginning of year Capital 67,561 32,797 100,358 95,497 New donations and endowments 119 393 512 677 Transfers - 136 136 (1) Increase/(decrease) in market value of

investments 4,246 1,236 5,482 4,185

Balance at end of year 71,926 34,562 106,488 100,358 Analysis by type of purpose Fellowship funds - 10,217 10,217 9,838 Scholarship funds - 829 829 799 Prize funds - 398 398 383 Hardship funds - 491 491 473 Bursary funds - 12,393 12,393 11,530 Travel and research grant funds - 1,791 1,791 1,694 Other funds - 8,443 8,443 8,080 General endowments 71,926 - 71,926 67,561 71,926 34,562 106,488 100,358 Analysis by asset Property 30,777 - 30,777 32,672 Securities 36,875 34,562 71,437 66,152 Loan to Unrestricted Reserves 4,274 - 4,274 1,534 71,926 34,562 106,488 100,358


17 Restricted Reserves Reserves with restrictions are as follows: Consolidated and College Capital

Grants unspent

Permanent unspent

and other restricted

income

Restricted expendable endowment

2019 Total

2018 Total

£000 £000 £000 £000 £000 Balance at beginning of year Capital 3,667 - 4,445 8,112 7,009 Accumulated income 157 4,313 450 4,920 4,828 New grants 31 - 31 182 New donations - - 600 600 521 Endowment return transferred 96 928 122 1,146 1,069 Increase/(decrease) in market

value of investments 143 162 185 490 607

Expenditure (2) (905) (510) (1,417) (1,185) Transfers (2,016) - 26 (1,990) 1 Balance at end of year 2,076 4,498 5,318 11,892 13,032 Capital 1,947 - 4,461 6,729 8,112 Accumulated income 129 4,498 857 5,163 4,920 2,076 4,498 5,318 11,892 13,032 Analysis by type of purpose Fellowship Funds 2,434 2,660 5,094 4,943 Scholarship Funds 211 636 847 792 Prize Funds 60 - 60 55 Hardship Funds 222 - 222 215 Bursary Funds 374 1,188 1,562 1,302 Travel Grant Funds 469 379 848 802 Other Funds 2,076 728 455 3,259 4,923 2,076 4,498 5,318 11,892 13,032


18 Memorandum of Unapplied Total Return Included within reserves the following amounts represent the Unapplied Total Return of the College: 2019 2018 £000 £000 Unapplied Total Return at beginning of year 88,243 82,941 Unapplied Total Return for year (see note 3b) 6,357 5,302 Unapplied Total Return at end of year 94,600 88,243

19 Reconciliation of [consolidated] surplus for the year to net cash inflow from operating activities 2019 2018 £000 £000 Surplus/(deficit) for the year 8,097 7,056 Adjustment for non-cash items Depreciation 913 903 (Loss)/gain on endowments, donations and investment property (7,408) (6,066) Decrease/(increase) in stocks (10) (5) Decrease/(increase) in trade and other receivables 171 313 Increase/(decrease) in creditors (340) (404) Pension costs less contributions payable 426 233 Net cash inflow from operating activities 1,849 2,030

20 Cash flows from investing activities 2019 2018 £000 £000 Proceeds of disposal of tangible fixed assets - - Non-current investment disposal 5,894 884 Endowment funds invested (3,023) 379 Payments made to acquire non-current assets (3,174) (3,758) Total cash flows from investing activities (303) (2,495)


21 Capital commitments 2019 2018 £000 £000 Capital commitments at 30 June are as follows: Authorised and contracted £4.0m -

22 Pension schemes The College participates in two defined benefits schemes, the Cambridge Colleges Federated Pensions Scheme

(CCFPS) and the Church of England Funded Pension Scheme (CEFPS), one hybrid scheme, the Universities Superannuation Scheme (USS), and two defined contribution schemes, Cambridge Colleges Group Personal Pension Scheme and Now: Pensions scheme. The total pension cost, after personal health insurance contributions, for the year to 30 June 2019 (see note 7) was as follows:

2019 2018 £000 £000 CCFPS: charge to Statement of Comprehensive Income & Expenditure 443 421 USS: charge to Statement of Comprehensive Income & Expenditure 543 206 CEFPS -19 10 Cambridge College Group Personal Pension Scheme 109 90 NOW: Pensions 36 18 1,112 745

Universities Superannuation Scheme The total cost charged to the Income and Expenditure account was £0.5m (2018: £0.2m). At the financial year end the latest available complete actuarial valuation of the Retirement Income Builder section of the Scheme was at 31 March 2017 (the valuation date). This was carried out using the projected unit method. The 2018 actuarial valuation was finalised after the year end which indicated a shortfall of £3.6 billion. Since the institution cannot identify its share of USS Retirement Income Builder assets and liabilities, the following disclosures reflect those relevant for those assets and liabilities as a whole. The 2017 valuation was the fourth valuation for the scheme under the scheme-specific funding regime introduced by the Pensions Act 2004, which requires schemes to adopt a statutory funding objective, which is to have sufficient and appropriate assets to cover their technical provisions. At the valuation date, the value of the assets of the Scheme was £60.0 billion and the value of the Scheme’s technical provisions was £67.5 billion indicating a shortfall of £7.5 billion and a funding ratio of 89%. The key financial assumptions used in the 2017 valuation are described below. More detail is set out in the Statement of Funding Principles.

Pension increases (CPI) Term dependent rates in line with the difference between the Fixed Interest and Index Linked yield curves, less 1.3% p.a.

Discount rate (forward rates)

Years 1-10: CPI – 0.53% reducing linearly to CPI – 1.32% Years 11-20: CPI + 2.56% reducing linearly to CPI + 1.7% by year 21 Years 21 +: CPI + 1.7%

The main demographic assumption used relates to the mortality assumptions. These assumptions are based on analysis of the scheme’s experience carried out as part of the 2017 actuarial valuation. The mortality assumptions used in these figures are as follows:

2017 valuation Mortality base table Pre-retirement:

71% of AMC00 (duration 0) for males and 112% of AFC00 (duration 0) for females

Post retirement:

96.5% of SAPS S1NMA “light” for males and 101.3% of RFV00 for females

Future improvements to mortality

CMI_2016 with a smoothing parameter of 8.5 and a long term

improvement rate of 1.8% pa for males and 1.6% pa for females The current life expectancies on retirement at age 65 are:

2019 2018 Males currently aged 65 (years) 24.6 24.5 Females currently aged 65 (years) 26.1 26.0 Males currently aged 45 (years) 26.6 26.5 Females currently aged 45 (years) 27.8 27.8

A new deficit recovery plan was put in place as part of the 2017 valuation, which requires payment of 5% of salaries over the period 1 April 2020 to 30 June 2034. The 2019 pension liability provision reflects this plan. The provision figures have been produced using the following assumptions as at 31 March 2018 and 2019.

2019 2018 Discount rate 2.44% 2.64% Pensionable salary growth n/a n/a Pensions increases (CPI) 2.11% 2.02%

Since the year end, following the completion of the 2018 actuarial valuation, a new deficit recovery plan has been agreed. This amends the existing deficit recovery plan as set out in the 2017 valuation Schedule of Contributions. This new plan requires deficit payments of 2% of salaries from 1 October 2019 to 30 September 2021 and then payments of 6% of salaries from 1 October 2021 to 31 March 2028. As at 30 June 2019, and assuming all other assumptions used to calculate the provision remain unchanged, this would have resulted in a revised provision of £0.39m, a decrease of £0.25m from the current year end provision and a lower charge through the Statement of Comprehensive Income of £0.13m. Cambridge Colleges Federated Pension Scheme The College operates a defined benefits plan for the College’s employees of the Cambridge Colleges’ Federated Pension Scheme. The liabilities of the plan have been calculated, at 30 June 2019, for the purposes of FRS102 using a valuation system designed for the Management Committee, acting as Trustee of the Cambridge Colleges’ Federated Pension Scheme, but allowing for the different assumptions required under FRS102 and taking fully into consideration changes in the plan benefit structure and membership since that date. The principal actuarial assumptions at the balance sheet date were as follows:

2019 % p.a.

2018 % p.a.

Discount rate 2.25 2.70 Increase in salaries 2.90 2.75 Retail Prices Index (RPI) assumption 3.40 3.25 Consumer Prices Index (CPI) assumption 2.40 2.25 Pension increases in payment (RPI max 5% p.a.) 3.30 3.15 Pension increases in payment (CPI max 2.5%) 1.90 1.80

The underlying mortality assumption is based upon the standard table known as S3PA on a year of birth usage with CMI_2018 future improvement factors and a long-term rate of future improvement of 1.25% p.a. (2018: S2PA with

CMI_2017 future improvement factors and a long-term future improvement rate of 1.25% p.a.). This results in the following life expectancies:

• Male age 65 now has a life expectancy of 21.8 years (previously 21.9 years). • Female age 65 now has a life expectancy of 24.0 years (previously 23.8 years). • Male age 45 now and retiring in 20 years has a life expectancy of 23.1 years (previously 23.3 years). • Female age 45 now and retiring in 20 years has a life expectancy of 25.5 years (previously 25.4 years).

Members are assumed to retire at their normal retirement age (65) apart from in the following indicated cases:

Male Female Active Members – Option 1 Benefits 65 63 Deferred Members – Option 1 Benefits 62 60

Allowance has been made at retirement for non-retired members to commute part of their pension for a lump sum on the basis of the current commutation factors in these calculations. The amounts recognised in the balance sheet as at 30 June 2019 (with comparative figures as at 30 June 2018) are as follows:

30 June 2019 £’000

30 June 2018 £’000

Market value of plan assets 12,209 11,057 Present value of plan liabilities (18,481) (16,413) Net defined benefit asset/(liability) (6,272) (5,356)

The amounts recognised in the income and expenditure account for the year ending 30 June 2019 (with comparative figures for the year ending 30 June 2018) are as follows:

30 June 2019 £’000

30 June 2018 £’000

Current service cost 334 343 Administrative expenses 22 20 Interest on net defined benefit (asset)/liability 145 153 (Gain)/loss on plan changes 23 0 Curtailment (gain)/loss 0 0 Total charge 523 516

Changes in the present value of the plan liabilities for the year ending 30 June 2019 (with comparative figures for the year ending 30 June 2018) are as follows:

30 June 2019 £’000

30 June 2018 £’000

Present value of plan liabilities at beginning of period 16,412 16,669 Current service cost 334 343 Employee contributions 18 17 Benefits paid (428) (436) Interest on plan liabilities 442 432 Actuarial losses/(gains) 1,680 (612) (Gain)/loss on plan changes 23 0 Curtailment (gain)/loss 0 0 Present value of Scheme liabilities at end of period 18,481 16,412

Changes in the fair value of plan assets for the year ending 30 June 2019 (with comparative figures for the year ending 30 June 2018) are as follows:

30 June 2019 £’000

30 June 2018 £’000

Market value of plan assets at beginning of period 11,057 10,788 Contributions paid by the College 453 311 Employee contributions 18 17 Benefits paid (428) (436) Administrative expenses (35) (35) Interest on plan assets 297 279 Return on assets, less interest included in I&E 846 133 Market value of Scheme assets at end of period 12,209 11,057 Actual return on plan assets 411 411

The major categories of plan assets as a percentage of total Scheme assets at 30 June 2019 (with comparative figures at 30 June 2018) are as follows:

30 June 2019 30 June 2018 Equities 57% 64% Bonds & Cash 34% 30% Property 9% 6% Total 100% 100%

The plan has no investments in property occupied by, assets used by or financial instruments issued by the college.

Analysis of the remeasurement of the net defined benefit liability recognised in Other Comprehensive Income (OCI) for the year ending 30 June 2019 (with comparative figures for the year ending 30 June 2018) is as follows:

30 June 2019 £’000

30 June 2018 £’000

Return on assets, less interest included in I&E 846 133 Expected less actual plan expenses (13) (15) Experience gains and losses arising on plan liabilities 179 (119) Changes in assumptions underlying the present value of plan liabilities (1,859) 732 Actuarial gain/(loss) recognised in OCI (847) 730

Movements in the net defined benefit asset/(liability) during the year ending 30 June 2019 (with comparative figures for the year ending 30 June 2018) are as follows:

30 June 2019 £’000

30 June 2018 £’000

Net defined benefit asset/(liability) at beginning of year (5,356) (5,881) Recognised in I&E (523) (516) Contributions paid by the College 454 311 Actuarial gain/(loss) recognised in the OCI (847) 730 Net defined benefit asset/(liability) at end of year (6,272) (5,356)

Amounts for the current and previous four accounting periods are as follows:

30 June 2019

£’000

30 June 2018

£’000

30 June 2017

£’000

30 June 2016

£’000

31 June 2015

£’000 Present value of Scheme liabilities

(18,481) (16,413) (16,669) (14,594) (12,912)

Market value of Scheme assets 12,209 11,057 10,788 9,671 8,284 Surplus/(deficit) in the Scheme (6,272) (5,356) (5,881) (4,923) (4,628)

30 June 2019

£’000

30 June 2018

£’000

30 June 2017

£’000

30 June 2016

£’000

31 June 2015

£’000 Actual return less expected return on Scheme assets

846 133 1,038 1,118 709

Experience gain/(loss) arising on Scheme liabilities

179 (119) 92 69 40

Change in assumptions underlying present value of Scheme liabilities

(1,859) 732 (1,931) (1,305) (574)

Funding Policy Actuarial valuations are carried out every three years on behalf of the Management Committee, acting as the Trustee of the Scheme, by a qualified independent actuary. The actuarial assumptions underlying the actuarial valuation are different to those adopted under FRS102. The last such actuarial valuation was as at 31 March 2017. This showed that the plan's assets were insufficient to cover the liabilities on the funding basis. A Recovery Plan has been agreed with the College, which commits the College to paying contributions to fund the shortfall. These deficit reduction contributions are incorporated into the plan's Schedule of Contributions dated 28 June 2018 and are as follows:

• Annual contributions of not less than £178,856 p.a. payable for the period from 1 July 2018 to 31 March 2034.

These payments are subject to review following the next funding valuation, due as at 31 March 2020. Church of England Funded Pensions Scheme The college participates in the Church of England Funded Pensions Scheme for stipendiary clergy, a defined benefit pension scheme. This scheme is administered by the Church of England Pensions Board, which holds the assets of the schemes separately from those of the Responsible Bodies. Each participating Responsible Body in the scheme pays contributions at a common contribution rate applied to pensionable stipends. The scheme is considered to be a multi-employer scheme as described in Section 28 of FRS 102. This means it is not possible to attribute the Scheme’s assets and liabilities to each specific Responsible Body and this means contributions are accounted for as if the Scheme were a defined contribution scheme. The pensions costs charged to the SOCIE in the year are contributions payable towards benefits and expenses accrued in that year (2018: £5.0k, 2017:£9.3k ), plus the figures highlighted in the table below as being recognised in the SOCIE, giving a overall recovery of £19.0k for 2018 (2017: total charge of £10.3k). A valuation of the Scheme is carried out once every three years. The most recent Scheme valuation completed was carried out at as 31 December 2015. A valuation as at 31 December 2018 is currently underway, but the results of this are yet to be determined. The 2015 valuation revealed a deficit of £236m, based on assets of £1,308m and a funding target of £1,544m , assessed using the following assumptions: • An investment strategy of:

• for investments backing liabilities for pensions in payment, an allocation to gilts of 33% from the valuation date until 31 December 2019 and thereafter increasing linearly to 70% by 31 December 2030 (with the remainder in return-seeking assets); and

• a 100% allocation to return-seeking assets for investments backing liabilities prior to retirement; • Investment returns equivalent to 2.6% p.a. on gilts and 4.6% p.a. on return-seeking assets; • RPI inflation of 3.2% p.a. (and pension increases consistent with this); • Increase in pensionable stipends of 3.2% p.a.; • Mortality in accordance with 80% of the S2NMA and S2NFA tables, with allowance for improvements in

mortality rates in line with the CMI 2015 core projections with a long term annual rate of improvement of 1.5%.

Following the 31 December 2015 valuation, a recovery plan was put in place until 31 December 2025 and the deficit repair contribution payable (as a percentage of pensionable stipends) are as set out in the table below.

% of pensionable stipends January 2016 to December 2017

January 2018 to December 2025

Deficit repair contributions 14.1% 11.9% The deficit recovery contributions under the recovery plan in force as at 31 December 2016, 31 December 2017 and 31 December 2018 were as set out in the above table. For senior office holders, pensionable stipends are adjusted in the calculations by a multiple, as set out in the Scheme’s rules. Section 28.11A of FRS 102 requires agreed deficit recovery payments to be recognised as a liability. The movement in the balance sheet liability over 2017 and over 2018 is set out in the table below.

2018 2017 £ £ Balance sheet liability at 1 January 24,000 23,000 Deficit contribution paid -3,000 -3,000 Interest cost (recognised in SOCIE) 0 0 Remaining change to the balance sheet liability* (recognised in the SOCIE)

-21,000 4,000

Balance sheet liability at 31 December 0 24,000 * Comprises change in agreed deficit recovery plan and change in discount rate and assumptions between year-ends. This liability represents the present value of the deficit contributions agreed as at the accounting date and has been valued using the following assumptions set by reference to the duration of the deficit recovery payments:

December 2018

December 2017

December 2016

Discount rate 2.1% pa 1.4% pa 1.5% pa Price inflation 3.1% pa 3.0% pa 3.1% pa Increase to total pensionable payroll 1.6% pa 1.5% pa 1.6% pa

The legal structure of the scheme is such that if another Responsible Body fails, the Christ’s College could become responsible for paying a share of that Responsible Body’s pension liabilities.

23 Prior Year Adjustments Prior year comparative figures have been restated to reflect a revised allocation of overheads, with £0.6m (2018: £0.6m) formerly charged to Other Expenditure now being charged to Education and Residences, catering and conferences.

24 Principal subsidiary and associated undertakings and other significant investments

Name of subsidiary undertaking Country of registration

and operation

Class of share

Proportion held

Nature of business

Christ’s College Enterprises Ltd England Ordinary 100% Property Development

Christ’s College Trading Ltd England Ordinary 100% Hospitality

25 Related Party Transactions During the year no fees or expenses were paid to Fellows in respect of their duties as members of the Council or Governing Body. (2018: nil) Owing to the nature of the College’s operations and the composition of the Governing Body it is inevitable that transactions will take place with organizations in which a member of the Governing Body has an interest. All transactions involving organizations in which a member of the Governing Body may have an interest are conducted at arm’s length and in accordance with the College’s normal procedures.

26 Contingent Liabilities With effect from 16 March 2007, the Universities Superannuation Scheme (USS) positioned itself as a “last man standing” scheme so that in the event of an insolvency of any of the participating employers in USS, the amount of any pension funding shortfall (which cannot otherwise be recovered) in respect of that employer will be spread across the remaining participant employers.

27 USS Post Balance Sheet Event As set out in Note 22 in respect of the USS pension scheme, a new Schedule of Contributions based on the 2018

actuarial valuation has been agreed post year end. This results in a decrease of £0.25m in the provision for the obligation to fund the deficit on the USS pension which would instead be £0.39m. As the Schedule of Contributions was not in place at the financial year end this adjustment will be reflected in the Financial Statements for the year ended 30 June 2020.

College Accounts 2018-19

Documents

Transcript of College Accounts 2018-19